With a lot of turbulence in the recycling materials market, we felt it was important to bring you an update on some of the issues which are affecting the industry.
Cardboard
Over the last year, prices in the waste paper market for used cardboard have been falling fast. The decline in the market comes largely from reduced orders from China as well as the general economic slowdown across Europe. This has been further exacerbated by the looming Christmas retail period, where in some places used cardboard movement could be delayed and have to be stored.
A crisis warning recently came from Jean-Luc Petithuguenin, president of the global trade association BIR’s Paper Division. He warned: “For the lower grades, there is insufficient demand for the available supply and the lowest grades are difficult to place in the market.”
Suggestions are that this month prices are lower than £38.00 per tonne in the export market for used cardboard, with domestic mills in the UK paying significantly lower prices. This means that waste management companies are now looking to cover the cost of the collection and transportation of baled cardboard, costs which would normally be offset from a healthy rebate price.
The drastic fall in the value of cardboard will also have an influence on the cost of Dry Mixed Recycling (DMR), as cardboard makes up a big proportion of the DMR waste stream.
Plastics
For the plastics market there is a more positive outlook, with a high demand in the market for recovered plastic material where the quality is good and free from contamination.
We would advise customers, to get the highest rebates for their plastics they must do their utmost to keep their materials contamination free.
If you are producing large quantities of plastics, keep clear plastics separate from coloured, as this can have a huge impact on rebate values.
Plastics such as banding, polypropylene sacks and hard plastics must be kept separate and baled individually, to generate the best rebates.
Refuse Derived Fuel
The refuse derived fuel (RDF) market is also facing a period of uncertainty following proposals announced by the Dutch Government that a €32.00 per tonne import tax is likely to come into effect on the 1 January 2020. Sweden has also confirmed it is going to introduce their own tax on RDF in April 2020 of £6.00 per tonne. This is also further exacerbated by uncertainty around Brexit.
RDF is a fuel produced from various types of waste such as municipal solid waste, industrial waste or commercial waste. Currently much of the RDF produced in the UK is exported to Europe.
The potential outcomes are that costs could increase for Refuse Derived Fuel and therefore alternative outlets and methods of disposal will be required. One council has recently announced (Dec 19) that 200,000 tonnes of material which was originally destined for RDF will now be sent to Landfill in the wake of the current climate.
At the moment this is for information only and whilst we don’t anticipate any disruption to services in the short term, we feel it is important to ensure our customers are kept up to date on these important developments in the industry. We will continue to bring you developments through our news updates and your account management team.
If you would like any advice on managing your waste material resources or have any concerns regarding this information please do not hesitate to contact us for assistance. An expert member of our team can provide you with the information you need to navigate the best opportunities for your recovered materials.